Half In Foreclosure Skip Floridaordered Mediation

By Yudislaidy Fernandez
Fewer than half of homeowners in Miami-Dade who face foreclosure take part in state-mandated foreclosure mediation, an effort to decrease foreclosure cases while helping homeowners keep their homes.

In January, the Florida Supreme Court ordered state judges to require mediation on all future foreclosures before the court moves forward with a case.

Mediation, which includes foreclosure counseling, seeks an agreement between the borrower and lender to avoid the higher costs and delays of foreclosure.

Foreclosure mediation is free to homeowners and generally takes one to two hours in which alternatives to a foreclosure are discussed, such as a loan modification, deed in lieu of foreclosure or short sale of the home, said Ned Pope, director of the Mortgage Foreclosure Mediation Program, administered by the non-profit Collins Center for Public Policy.

"Our program kicks in when the foreclosure is filed with the court," he explained. "We are not working with people in danger of foreclosure. We are working with those who have been foreclosed upon."

In Miami-Dade, about 5,700 mediation meetings have been completed since the program started in May 2009, Mr. Pope said. Another 1,100 are scheduled.

Miami-Dade, Brevard and Escambia counties ran for months a managed mediation pilot program similar to the one the state adopted in January.

Since the mediation program took effect in all of Florida, the Collins Center has held more than 8,000 mediations statewide.

The center works with 600 mediators, all independent contractors, and six credit counseling agencies, Mr. Pope noted.

The biggest challenge now is to increase borrower participation, he said, as many borrowers ignore the mediation notice because they are unsure of its authenticity.

"When they (borrowers) see mail and calls, they don’t recognize us as a court-sponsored provider of this service," he said, a reason many troubled borrowers aren’t participating.

Some "can’t differentiate us from a non-sponsored program," he said, as they are also getting letters and calls from attorneys offering to solve their foreclosure problems.

The foreclosure crisis affecting South Florida in recent years has prompted many lawyers to offer foreclosure relief services, making homeowners more distrustful of mediation services offered to them.

This year, 24,064 foreclosure actions have been filed against Miami-Dade homeowners — fewer than half the 64,001 cases filed in 2009, according to the county’s clerk of the courts.

When someone gets a mediation notice, Mr. Pope added, "we ask them to give us a call and look at the options before automatically dismissing it."

Once the center gets the borrower’s information from the lender, it tries to contact the borrower to schedule mediation. It sends three written notices and makes four phone calls.

Borrowers have 30 days to reply to the center’s request. Otherwise, the center notifies the court that the borrower didn’t respond. Then, the court moves forward with the foreclosure case.

But Mr. Pope said that when borrowers show up to court, they still have one last chance to agree to mediation.

"The goal is to put the homeowner in a position to talk face-to-face with a representative of the lender," he said. "That has been the biggest problem for borrowers who say they have trouble communicating with the lender.… Mediation offers the opportunity to sit down and reach an agreement like a loan modification or some alternative to the foreclosure."Details: www.collinscenter.org